You will have the cash to invest in Airtasker at the end of 2021 (t=0). Based on your forecasting, you expect Airtasker to start paying dividends in 2026. You expect the dividend to be 10 cents per share in 2026, growing by 10% pa over 2027 and 2028, 5% pa in 2029 and 2030, then 3% p.a. indefinitely. Assuming a required rate of return of 9%, what is the valuation of Airtasker using the dividend discount methodology as at the end of 2021? Show your workings.
You will have the cash to invest in Airtasker at the end of 2021 (t=0). Based on your forecasting, you expect Airtasker to start paying dividends in 2026. You expect the dividend to be 10 cents per share in 2026, growing by 10% pa over 2027 and 2028, 5% pa in 2029 and 2030, then 3% p.a. indefinitely. Assuming a required rate of return of 9%, what is the valuation of Airtasker using the dividend discount methodology as at the end of 2021? Show your workings.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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You will have the cash to invest in Airtasker at the end of 2021 (t=0). Based on your
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